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FSL Trust to take impairment on tanker sale

FIRST Ship Lease Trust is selling a tanker to a third party, and will take an impairment charge on the vessel, said the manager on Friday night.

The 14-year-old FSL Hamburg, a 47,496 deadweight tonnage tanker, will be sold in a deal that is expected to be completed by the end of March this year.

Some of the net proceeds from the sale will go towards repaying part of the trust's bank debt, while US$6.5 million will be used to pay off instalments on the US$97.6 million of new-build vessels whose shipbuilding contracts were announced in December 2018.

The trust will take an impairment charge of about US$6.3 million on the FSL Hamburg, which was classified as "held for sale" as at Dec 31, 2018.

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Roger Woods, chief executive of the manager, said in a statement: "In line with the trust's ongoing fleet renewal strategy, we are pleased to report this disposal, which will help fund the new-building acquisition, will reduce the outstanding bank debt, thus improving the trust's risk profile while preparing the trust to take advantage of the expected recovery in the sector."